Why Ripple Crash Precedes Rally To $1

Highlights

XRP price poised to rally as supply on exchanges dips to 2.64 million.
Ripple expands partnerships with global banks in China, Hong Kong, and the Philippines.
Whales steadily increase holdings, affirming the long-term bullish outlook.
XRP is edging close to a major technical breakout, targeting $0.74.

XRP price is down nearly 4% in seven days as Bitcoin (BTC) and Ethereum (ETH) restarted their short-term bullish trends after upholding key support levels. Despite the short-term bearish trend, Ripple signals a long-term bullish outlook reflected by a spike in whale accumulation and solid fundamentals.

XRP Price Market Movers: $200M Whale Transfer, Ripple Partnerships, Bullish On-chain Metrics

XRP price experienced a 2.2% decline in 24 hours, with the weekly loss summing to 2.8% amid a massive 94,325,384 XRP transfer from an unknown wallet to another unknown wallet, Whale Alert updated on X earlier today. If the whale intends to sell or diversify into other digital assets, this transfer could dampen the impending breakout and possibly trigger another sell-off.

🚨 🚨 🚨 94,325,384 #XRP (53,656,730 USD) transferred from unknown wallet to unknown new wallethttps://t.co/3kH4omAfIq

— Whale Alert (@whale_alert) August 28, 2024

Major banks continue to join Ripple’s payment network to reduce costs, increase transaction speed, and access new markets. According to the latest report, many global banks tap into the blockchain company’s XRP Ledger (XRPL) technology hail from China, Hong Kong, and the Philippines, including the Agricultural Bank of China, Bank of Beijing, and Standard Chartered Bank. Intriguingly, Bank of America has collaborated with Ripple since 2018 despite previous doubts, highlighting the company’s ability to offer robust financial services and transactions.
The supply of XRP on exchange recently fell below the 3 million mark to hold at 2.64 million on August 27. Note that a persistent decrease in this Santiment metric can be a bullish sign. It proposes that investors are holding XRP as opposed to selling and signals confidence in XRP price appreciation.

Ripple whales are unfazed by price doldrums, seeing that they continue to increase their XRP holdings. On-chain data reveals that large-volume investors currently hold 3.88 billion XRP, a significant increase from early August. This trend is bullish for Ripple price and may bolster the anticipated breakout.

Technical Analysis: XRP Price Breakout In The Offing

XRP hovered at $0.5728 on Tuesday during the US trading session. The 50-day Exponential Moving Average (EMA) provides immediate support downside, while the 20-day EMA highlights resistance at $0.582.

A daily close above the 20-day resistance will help affirm the short-term bullish outlook. Ultimately, this may bolster the chances of an inverse head and shoulders (H&S). This is a bullish pattern that, if validated, could boost XRP price by 21.6% to $0.74—a breakout target determined by the height of the pattern and extrapolated above the breakout point.

Conversely, it is prudent for traders to prepare for divergent outcomes. In other words, the downtrend could extend if the 50-day support at $0.5661 crumbles. In that case, the 200-day support at $0.5487 will come in handy while not ruling out a major sell-off to $0.5 and even $0.4 if the SEC appeals the lawsuit ruling.

Frequently Asked Questions (FAQs)

1. What is the XRP Ledger?

The XRP Ledger is a distributed ledger technology (DLT) that powers the XRP cryptocurrency. It's designed for fast, efficient, and scalable transactions, making it a popular choice for cross-border payments.

2. Can declining supply on exchange push XRP higher?

A decrease in the supply on exchanges can be a bullish sign, suggesting investors are holding XRP rather than selling.

3. What is XRP?

XRP is a digital asset created by Ripple Labs. It is designed to facilitate fast, efficient, and cost-effective cross-border payments. XRP is often used as a bridge currency between different fiat currencies.

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John Isige

John is a seasoned crypto expert, renowned for his in-depth analysis and accurate price predictions in the digital asset market. As the Price Prediction Editor for Market Content at CoinGape Media, he is dedicated to delivering valuable insights on price trends and market forecasts. With his extensive experience in the crypto sphere, John has honed his skills in understanding on-chain data analytics, Non-Fungible Tokens (NFTs), Decentralized Finance (DeFi), Centralized Finance (CeFi), and the dynamic metaverse landscape. Through his steadfast reporting, John keeps his audience informed and equipped to navigate the ever-changing crypto market.

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